Deflating a nominal quantity is the process of dividing a ________ quantity by a ________ in order to express the quantity in ________ terms.
A. real; nominal quantity; real
B. nominal; price index; real
C. real; price index; nominal
D. nominal; real quantity; nominal
Answer: B
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What is a problem with anti-trust laws involving restrictive practices?
a. The practices are not always illegal. b. So many firms engage in the practices, it is hard to prosecute all the firms. c. The practices do not cause prices to increase in all cases. d. What practices are illegal is clearly understood.
Hudson Manufacturing is an MNE based in the United States with operations in Asia. The firm is considering expansion into the European Union. Executives at the firm are debating whether central Europe or Eastern Europe would be best for the firm. Which of the following best supports a decision to establish operations in Eastern Europe?
A) Hudson wants to implement a high-performance work system. B) Hudson plans to staff the foreign facility with local managers. C) Hudson wants to minimize costs by keeping wages low. D) Hudson recently lost money in a joint venture.
Which of the following statements about stock market brokers and dealers is TRUE?
A) Brokers earn commissions from trading stocks but dealers try to profit from trading stocks. B) Brokers try to profit from trading stocks but dealers earn commissions from trading stocks. C) Both brokers and dealers earn commissions from trading stocks. D) Both brokers and dealers try to profit from trading stocks.
Which of the following reflects the incentive structure confronted by a typical firm in a cartel?
a. If I alone cheat, I'm better off; if everyone cheats, I'm worse off. b. I can never do better for myself than by following agreed-upon cartel policies. c. If everyone cheats, I'm better off and so is everyone else in the cartel. d. If I suspect others are planning to cheat, I'll do best for myself by deciding not to cheat.